starlitwonder
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- May 24, 2005
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- HSC
- 2006
What do exchange rates have to do with the Balance of payments?
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Exchange Rates (1 Viewer)
- Thread starter starlitwonder
- Start date
Mr. Sabuncuoglu
Foo Fighter
that equilibrium comment was pretty good... 
also it sorta has a relatoinship with the BOP i.e. the Current Account... if there is depreciation of the AUD, x's will increase as the conversion of foreign currency becomes somewhat cheaper... vice versa, if there is an appreciated AUD, M's will become cheaper therefore deteriorating the Balance of Goods and Services, another concept also is the Foreign Debt and Liabilities to foreign countries... An Appreciated dollar will have a valuation effect on the "interest" or repayments/financial obligations to our "fellow" nations lol... etc... depreciated dolalr with a "devaluation effect" and thus making it harder for Australia to "service" it's foreign debt and the need for "foreign liabilities" becomes apparent... leading to a possible "debt trap scenario" where Australia cannot meet it's financial obligations to other foreign countries, as it is borrowing to finance it's already existing foreign debt.....
hope that sorta gives u a brief view of the "broad" question u jus asked...
wish me luck inm y trials... got htem tomoro...
also it sorta has a relatoinship with the BOP i.e. the Current Account... if there is depreciation of the AUD, x's will increase as the conversion of foreign currency becomes somewhat cheaper... vice versa, if there is an appreciated AUD, M's will become cheaper therefore deteriorating the Balance of Goods and Services, another concept also is the Foreign Debt and Liabilities to foreign countries... An Appreciated dollar will have a valuation effect on the "interest" or repayments/financial obligations to our "fellow" nations lol... etc... depreciated dolalr with a "devaluation effect" and thus making it harder for Australia to "service" it's foreign debt and the need for "foreign liabilities" becomes apparent... leading to a possible "debt trap scenario" where Australia cannot meet it's financial obligations to other foreign countries, as it is borrowing to finance it's already existing foreign debt.....
hope that sorta gives u a brief view of the "broad" question u jus asked...
wish me luck inm y trials... got htem tomoro...